This summary covers a non-shareholder loan by Standard Chartered Bank of the United Kingdom, and other financial institutions still to be identified, to the Development Bank of Southern Africa (DBSA). Standard Chartered, and other financial institutions still to be identified, have applied for a MIGA guarantee of up to $361 million for a period of up to 11 years against the risk of non-honoring of financial obligations by a state-owned enterprise.
This proposed project involves the expansion of lending by DBSA, a wholly-owned financial institution of the government of South Africa. As the key implementing agency for South Africa’s National Development Plan, DBSA supports economic growth and development in the country and the broader Southern African Development Community. MIGA’s support will allow DBSA to expand its US dollar lending portfolio, primarily in infrastructure.
This is a category FI-1 project under MIGA’s Policy on Environmental and Social Sustainability, given the exposure to large scale infrastructure projects in the energy, transport and water sectors. DBSA implements best practice with regard to environmental and social risk management and applies the MIGA Performance Standards to regional projects. DBSA has a comprehensive Environmental and Social Management System in line with MIGA’s Performance Standard 1 on Assessment and Management of Environmental and Social Risks and Impacts and also complies with the requirements of MIGA’s Performance Standard 2 on Labor and Working conditions.
Resolving infrastructure bottlenecks to deepen regional integration has been identified as a key component in increasing South Africa’s competiveness with a positive impact on exports, jobs, and tax revenue for South Africa as well as the SADC region.
MIGA’s proposed support for DBSA is consistent with the World Bank’s FY14-17 Country Partnership Strategy as well as the South Africa’s National Development Plan, which puts promotion of private investment and job creation at the top of the government’s agenda.